Cars without tires: the auto industry is waiting for another deficit

Cars without tires: the auto industry is waiting for another deficit

FineAuto

As automakers continue to grapple with the global semiconductor chip shortage and are likely to do so by the end of the year, another shortage is brewing, this time related to rubber.

Analysts warn that global rubber supplies are critically limited, in part due to increased demand for rubber gloves and packaging films during the pandemic. The proposal has also been hit by drought, floods and leaf diseases in countries like Vietnam and Thailand, which are leading rubber producers.

Bloomberg notes that in addition to these changes in supply and demand for rubber, China began to actively buy rubber last year to replenish its national stocks. The United States did not follow suit. In February, natural rubber prices hit a four-year high of $ 2 a kilogram, and former rubber firm Halycon Agri Corp CEO Robert Meyer believes prices could hit $ 5 a kilogram over the next 5 years.

“The supply problems we are seeing now are structural in nature. The situation will not change soon, ”Meyers told Bloomberg.

While commenting on the scarcity, Ford and Stellantis confirmed that they are monitoring it, but have not yet felt its impact. Likewise, General Motors says it is not concerned about rubber supplies at this stage. Michelin added that it is avoiding port congestion with air cargo from Asia.

“This is definitely getting tougher. From our point of view, it is still far from the level of shortage of chips, but it is definitely brewing, ”said a spokesman for auto parts maker Foley and Lardner LLP.

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